Steve Jobs wants to keep you happy by giving you a free case for his company's defective iPhone 4. (Source: ArsTechnica)

"Phones aren't perfect" -- Steve Jobs

Today at Apple's 1 p.m. EST, 10 a.m. PST press conference, Apple finally formally addressed the iPhone 4's faulty antenna, which its engineers reportedly warned it about last year, but it ignored. Despite reports claiming that it might initiate a recall, Apple took a hard line, with most of its presentation boiling down to one word -- denial. But to Apple's credit it is giving users a free bumper case and letting them return their phones for free within 30 days if they're still unhappy.

Apple CEO Steven P. Jobs who infamously told users "You're holding it wrong" took the stage and began by stating, "We're not perfect. Phones aren't perfect either... But we want to make all of our users happy.We love making our users happy.We're going to talk about how we're going to do that today... but before we get into that I want to talk about the problems and the data we've got so that we can make sure we make all our users happy."

Jobs then turned to a bit of bragging -- a record 3 million iPhone 4s sold in only 3 weeks. He described it as the best smart phone in history, saying reviews back him up on that.

He then commented, "We started getting some reports of people having issues with the antenna system..People were touching this spot here. Seeing a large drop in bars... sicne dubbed Antennagate. We heard about this just 22 days ago from today. It's not like Apple's had its head in the sand for 3 months on this... Apple is an engineering driven company."

He then turned to tests which Apple engineers conducted. He claims those tests show similar drops in signal, based on hand grip with a Blackberry, the HTC Droid Eris, and the Samsung Omnia 2. Jobs' conclusion? "This is life in the smartphone world. Phones aren't perfect."

Of course Jobs failed to show a wide variety of smart phones -- such as the HTC EVO 4G, Droid Incredible, etc.

He again reaffirms his stance that users need to be sure to have the correct grip and that the problem is mostly imagined stating, "We went to a lot of trouble to put this beautiful line in the stainless steel to say here's where you touch it everybody... and we had incorrect bars, so when it did drop the drop looked far more catastrophic."

Apple says that its testing to come to this conclusion was extensive. It spent $100M USD on its signal testing facility, complete with anechoic chambers. It has hired 18 PhD scientist and engineers (though earlier reports indicate it perhaps wasn't listening to them).

In his presentation, Jobs cites AppleCare numbers which he claims indicate that only 0.55 percent of customers had enough of an issue to contact Apple. Further, he says that return rates on the iPhone 4 are a miniscule 1.7 percent down from 6 percent (granted maybe some customers were waiting for Apple's response).

Jobs did admit that the iPhone 4 drops more calls that the iPhone 3GS, but claims that it only drops 1 more call per 100 calls than the 3GS hardware -- in other words less than a 1 percent difference. He claims his inbox has been overflowing with emails telling him how wonderfully the iPhone 4 is working and how great it is. In fact he claims he received 5,000 such emails.

He concludes by summarizing about the cosmetic "fix" to the number of bars drawn. And then finally, he tosses customers a bone. Apple will be giving out a free cases (Apple's own $30 USD newly designed case which reportedly fixes much of the signal problems or similar third party designs). Until Sept. 30 Apple will give one of the cases to every iPhone 4 purchaser for free. Customers who already bought a case will be refunded. And international customers will be eligible for the offer as well.

The proximity sensor issue was also briefly mentioned, and chief Jobs says a software fix is incoming. He also reminded that the white iPhone 4 will arrive at the end of July and that the iPhone 4 will launch in 17 countries on July 30th, as well.

The conference wraps up with Jobs commenting, "We love our users. We try very hard to surprise and delight them.. we work our asses off and we have a blast doing it. What motivates us is to have them love our products. We also connect them with great apps and content. We love our users so much we've built 300 apple retail stores for them. When we fall short we try harder."

"And when we succeed they reward us by staying our users... so that's what drives us. And when we have problems like this and people are criticizing us, we take it really personally. Maybe we shouldn't, but we do. We all read these stories and we take it seriously. We think we've gotten to the heart of the problem, and the heart is that smartphones have weak spots. And so for those small number of customers that are having problems, we're going to give them cases, and for those that are still unhappy we're going to give them a full refund. But the data supports the fact that the iPhone 4 is the best smartphone in the world, and that there is no antennagate. And that's what I had to present to you today."

That also helps to hide the magnitude of the issue in general. "It only drops 2 in 100 calls" doesn't sound horrible until you understand how many millions of calls iPhone people are making every day. So in any given second how many iPhone users are going to have a call dropped? I'd bet the number could be over 100.

It's not: of every 100 calls you make on an iPhone 4, 2 will be dropped, it's of every 100 calls started on an iPhone 4 at any given time 2 will be dropped.

Then there's the 5000 e-mails of how wonderful the phone is, when Jobs himself talked about the 3 million they've sold. Which by my math means about 0.2% of the people who bought one loved it enough to e-mail him on how great a phone it is.

Typical Apple speak, play with the statistics right, leave out certain critical data, and you can seem to prove just about any claim.